Economic Logic, Too

About Me

I discuss recent research in Economics and various events from an economic perspective, as the name of the blog indicates. I plan on adding posts approximately every workday, with some exceptions, for example when I travel.

Friday, November 16, 2012

Why do people migrate? While there may be many motivations, it is very clear that migrants find much better material well-being in their new location. But they have to live away from their roots and traditions, and it is not clear their subjective well-being is better in the new location. Actually establishing this is very difficult, because migrants self-select themselves into migration. To do this properly, one would need a randomized experiment.

Steven Stillman, John Gibson, David McKenzie and Halahingano Rohorua have found this experiment with a migration lottery for Tongans interested in moving to New Zealand. The authors were able to interview both successful, unsuccessful and ineligible households one and four years after the lottery. They confirm that material well-being increases, but the matter of satisfaction is much more difficult to parse. Mental health is better, happiness lower. Interestingly, the study finds contradicting results when comparing recollection of welfare and static assessments. Despite this great dataset, we now only know better that we do not know.